Singapore News

News from Singapore

Government axes deferred payment scheme

Posted by jtsmyth8 on October 26, 2007

The deferred payment scheme that allowed homebuyers to postpone payments on new property was scrapped without warning by the Government last night. It said the strong economy and property market allowed it to axe the scheme, a move that will also deter speculators and force people to be more prudent when committing to pricey real estate.

It was a response to signs of overheating in the market, said National Development Minister Mah Bow Tan said last night.

‘There’s a danger that we may feel over exuberance in the market. There’s also a danger that it may actually encourage excessive speculation,’ he said.

Buyers will now have to make progressive payments in step with the construction process, instead of deferring payment until the property is completed a few years down the track.

Experts tip prices and sales will be hit although the impact may not be significant given the robust demand.

(story)

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2 Responses to “Government axes deferred payment scheme”

  1. what was the payment scheme and why govt took that step?

  2. jtsmyth8 said

    “Scheme” perhaps is the wrong word. It’s a payment system that helps people purchase property. It allows the buyer to put very little money up front while the government puts in the rest of the deposit. In recent times due to the hot real estate market, investors have been using the system to make profit by making deposits on several properties, then flipping them. It’s essentially a zero interest short term cash loan. Thanks for you comment, hope I clarified it for you. JT

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